When it is served as sushi, it is generally presented as a maki, but not rolled inside the rice. Instead, a loose collar of nori is folded around sushi-rice with a space above the rice which is filled with the roe.

Writing
It has three different spellings in kanji. One form means seachestnut, which comes from its appearance. It is also often spelled out in hiragana. Japanese scientists like to use katakana to spell living things in general.

Definition1
(1) sea urchin, or (2) salted sea urchin roe (meaning the eggs) that is used for food. (Sorry to disagree, sensei.)
There are many kinds of uni, of various colors and sizes.

As a sushi item
Best eaten salted, uncooked, and still juicy. Uni is indeed a delicacy, and as it is often the case with the more popular sushi items, it is higher in calories and higher in price. Uni is served either as neri uni (egg paste) or tsubu uni (with the eggs still having form), and it is in season during Spring.

A common misunderstanding
A common misunderstanding held among Americans, told to gross out other Americans, is that uni is the semen part. Actually, only the eggs of sea urchins are food. They are most likely confusing uni with shirako, which comes from a different fish.

Super Mario Brothers 3
Appears in some SMB3 sea levels as a big purple square shaped character officially known as unitaro.

Source(s)
1 - http://dictionary.goo.ne.jp/ (Page in Japanese. Uni also means charcoal, but people usually don't use that word.)

2009-02-25: Update and a correction: According to a TV show on uni, apparently it's both the eggs and the semen that are eaten in Japanese cuisine. You either get egg packs or semen packs from a single sea urchin. Surprisingly, they both look and taste very similar, and are sometimes not distinguished at food markets.